Friday, November 25, 2011

I Believe in Merkels (Where You From You Sexy Thing)

...Miracles right before my eyes
You sexy thing got me hypnotised
Don't stop what ya' doing
What ya' doing to me
My angel from above lying next to me
How did ya' know that I'd be the one
Been a long time coming only just begun
Doing all the things that makes my heart sing
Keep doing what you're doing you sexy thing...

From FT Alphaville, some longer-form blogging:[Something for the weekend] Do you believe in Merkels?

At first sight, this looks mad. Lending to the UK government, in charge of the clapped-out British economy, now returns less than lending to Europe’s most successful country. Worse still, the yields on gilts are measured in sterling, a chronically weak currency, so not only does your money earn less, you’ll be repaid in something which history says will have been devalued by the time you get it back. Oh, and by the way, inflation is 3 per cent above the yield, making the internal devaluation painful, too.

Something is seriously awry here, and two events this week offer clues to why German government 10-year paper yields more than the equivalent UK stock. On Wednesday the markets were spooked by the failure of an auction of 10-year German debt. Those in this arcane world struggled to understand what it meant, so there’s little hope for the rest of us. It’s either bad news, or very bad news, probably depending on whether you’re short of German bonds....MORE

Ladies and gentlemen, Hot Chocolate!

On second thought, maybe Alphaville's title refers to the 1980 Miracle on Ice.

If that is the case I apologize for any nightmares induced by the image of the German Chancellor being anything but an asexual Head-of-Government.‘Germans fed up with Eurobondage’